THERE were smiles from both sides when China and the United States reached agreement in May on the future of aviation routes between the two countries.

Announced during high-level talks between China's Vice Premier Wu Yi and US Treasury Secretary Henry Paulson, the new deal promised to more than double by 2012 the daily non-stop flights between the countries.

Carriers from both countries would have the option of increasing the number of daily flights they operate from the current 10 to 23.

China's top civil aviation official, Yang Yuanyuan, called on Chinese airlines to "seize the opportunity" to grow their China-US business. US Transportation Secretary Mary Peters, in turn, said she expected US carriers' revenues to rise by US$5 billion as a direct result of the new flights.

Two months on, a survey of how aviation players are reacting on both sides of the Pacific reveals two starkly contrasting realities. While American carriers are engaged in a fierce bidding war for the new flights in a market that has grown 12.5 percent a year since 2000, their Chinese counterparts are doing nothing more than sitting and watching.

Profit split

"If an airline is profitable, it will definitely look to increase flights or destinations," said Ma Ying, aviation analyst with Haitong Securities. According to Ma, this contrast shows the US carriers were making good profits on the present routes, while the Chinese ones were not.

All six major passenger airlines in the US announced the routes they were applying for before the July 16 deadline set by the US Department of Transportation, which will decide by August whom to award the flights to.

Up for grabs in this round of bidding are the six flights that will become available over three years - one this year, one in 2008, and four in 2009.

Analysts say winning any one flight could mean a US$100 million bump in annual revenues for a US carrier.